Selling to government and contracts in Kuwait

01How government buys

Government purchasing is governed by the Public Tenders Law (Law 49/2016), amended by Law 74/2019 and Law 1/2024. CAPT runs the process.

• State Audit Bureau approval is needed before award.
• Entities contract without CAPT involvement up to KWD 75,000 under a Ministry of Finance circular.
• The bid period is up to 90 days.
• The award is made within three months of the bid deadline.
• A complaint must be lodged within seven working days.

02Foreign bidders and local agents

Bids Circular 4/1997 requires foreign bidders to be linked to a Kuwaiti partner or agent by a documented contract. Law 1/2024 amended Article 31 of the Public Tenders Law to let foreign bidders take part without a local agent.

• Law 1/2024 amended Article 31 so that foreign bidders can take part without a local agent.
• Its executive regulations have not been issued and the change is not applied in practice.
• Bids Circular 4/1997 still requires foreign bidders to be linked to a Kuwaiti partner or agent by a documented contract.

03Local content and price preference

Under the Public Tenders Law, foreign contractors buy at least 30% of their inputs locally where available. A 15% price preference applies to locally produced or GCC-produced goods. A waiver is granted case by case.

• The 30% local purchase rule applies to foreign contractors on public contracts.
• The 15% price preference applies to goods produced in Kuwait or in the GCC.

04Tax retention on contract payments

Kuwaiti government entities hold back 5% of contract payments until a tax clearance certificate is shown.

• The retention is not a withholding tax.
• The Budget Executive Regulations for FY 2026/2027 (29 March 2026) say it is not applied to an entity inside the DMTT regime and compliant with its tax obligations.

05Public-private partnerships

Public-private partnerships fall under Law 116/2014 and are run by the Kuwait Authority for Partnership Projects (KAPP).

• KAPP procures projects of up to KWD 60 million.
• Above KWD 60 million, the project company is a shareholding company with 50% offered to Kuwaiti citizens in an IPO.

06Offset programme

The offset programme was suspended permanently on 24 August 2015. KDIPA runs the settlement of obligations already signed.

• Offset Programme Guidelines 9/2007 required 35% of contract value to be reinvested for defence contracts of KWD 3 million or more and civil contracts of KWD 10 million or more.
• The Council of Ministers suspended the programme permanently on 24 August 2015 (Decision 1212).
• Obligations can be met by cash payment to a state account, direct implementation of a listed project or implementation by a third party. All three options earn a 5.5 multiplier.
• Eligible sectors are research and laboratories, arts and culture, education and training, environment and medical.

07Regional headquarters

Kuwait has no regional headquarters scheme tied to government contracts.

08Commercial agents and distributors

Agency and sponsorship agreements are registered with MOCI, which issues a registration certificate. Agents are banned in contracts with KPC and its wholly owned subsidiaries.

• Commercial Agency Law 13/2016 removed exclusivity, so a foreign principal can appoint more than one agent.
• Remuneration is set by agreement.
• A foreign principal that sells through a Kuwaiti distributor is not itself taxed on those sales.
• Decree-Law 67/2026 (Article 18) bans local or commission agents in contracts with KPC and its wholly owned subsidiaries. It was published in Kuwait Al-Yawm issue 1797 on 28 June 2026 and was in force on publication.
• The ban applies to future contracts. Existing agreements run until they expire.

09Contract law, language and currency

Kuwait is a civil law country. Filings and court proceedings are in Arabic.

• Judgments do not bind later courts.

Currency

• The Kuwaiti dinar (KWD, 1,000 fils) is pegged to an undisclosed weighted basket of currencies chosen by the Central Bank of Kuwait.
• The basket peg has applied since 20 May 2007 (Decree 147/2007). It replaced a dollar peg held from 5 January 2003.
• Foreign exchange goes through a bank or a licensed dealer.
• Equity, loans, interest, dividends, profits, royalties, fees and personal savings move in and out of Kuwait without restriction.

10Courts and enforcement

Kuwait has three court levels. The Execution Department of the Court of First Instance enforces judgments.

• The three levels are the Court of First Instance, the Court of Appeals and the Court of Cassation.
• Documents for any court or authority need an Arabic translation.
• A foreign court judgment is enforced only where reciprocity exists.
• The KDIPA law states that Kuwaiti courts handle disputes involving a foreign investor, with arbitration allowed.

11Arbitration

Arbitration is permitted. Kuwait is party to the New York Convention and the ICSID Convention.

• Institutional options are the Kuwait Commercial Arbitration Centre and the Kuwait Lawyers Bar Association arbitration centre.
• Judicial arbitration panels sit under Law 11/1995.
• A foreign award is enforced if its country belongs to the New York Convention and the award does not conflict with a final Kuwaiti judgment or public policy.